Worried mothers in the North last night joined MPs and consumer groups in demanding to know why milk prices rocket by a third between leaving farms and arriving on the shelves.

They said milk was essential to the good health of the region's children, and industry middle men should explain their costs which put an extra 18p on a litre of milk.

In a damning report on the industry, MPs yesterday concluded: "The dairy market is not operating correctly".

Their findings come as many diary farmers face making a loss on milk production. A litre costs 18p-23p to produce but prices to the farmer have averaged only 16p-20p in the past four years. The report, from the Commons Environment, Food and Rural Affairs Select Committee, said: "The evidence we have received suggests that about 18p per litre of the retail price of milk is being taken up by the dairy companies' costs," it said.

"We believe that the dairy companies should provide dairy farmers with a detailed justification of why it is they appear to need to take such a significant chunk of the retail price of liquid milk to cover their costs."

Newcastle-based website Netmums has campaigned for healthier eating, and spokesperson Siobhan Freegard said: "Milk is such an important part of a child's diet. They used to have free milk in schools every day. That's been taken away, but it should still be as easily accessible as possible.

"With families struggling to keep their head above water as it is, the retailers need to justify where these costs come from."

Secretary of the Tyneside branch of the National Consumers Federation, Mary Storer, said those at both ends of the milk chain were suffering while the big players made profits.

She said: "It's an ongoing complaint and we're always just told `that's the way it is'. We can only keep protesting and asking for some explanation.

"A farmer doesn't, on the surface, seem to be paid enough and the consumer doesn't feel they're getting good value for money. "It's the piper that calls the tune and it's the distributors who have that." Supermarkets and milk suppliers yesterday refused to comment, directing inquiries to their national bodies.